Just last month, AtomFilms announced the acquisition of Bill Plympton's
catalog of work, securing on and off-line distribution of his material.
In association with this renowned independent, they are pushing their
own net "envelope" by creating what will be the first in a
series of highly interactive fansites called "Plymptonia."
It will include Plympton's existing short films, his production of some
new original Flash content and provide as many interactive and informational
ideas as they can come up with. Next to launch in this new genre will
be a full service fan-site surrounding Aardman Productions entitled
"The Aardman Observer." These fan areas will take atomfilms.com
into differing design territories as they work toward making each of
them more expressive of the individual artists' unique identities, as
well as separating them out from the overall presentation of the site's
other content and channels.

Led by Mika Salmi, founder and CEO, AtomFilms' extraordinary growth
remains fueled by the adamant dedication to the cause of bringing independent
shorts to new audiences worldwide. Although submissions pour in daily
on VHS and digital files, Wynne stresses the importance of their continual
presence at animation festivals. "That's always the first and last
place for us and I think it's great for exposure. It brings a lot of
animators together in one place at one time...and the biggest advantage
in that is for the independent animator to meet with us face-to-face.
When you want to go into partnership with anyone, you want to feel good
about who you are going to work with and I think that `face time' is
the quality time." He believes unquestionably that the success
and future revenue for independent animation will be on the web, both
for artists and distributors alike. AtomFilms, then, is inarguably taking
the lead in making that happen.

Worms, Fish, Silicon and ChaosHonkworm International is certifiably one of today's leading entertainment
studios producing original animated properties optimized for the Internet
world. Currently in production and distribution of over six series
plus multiple one-off webisodes, Honkworm has plans to double its
output within the coming year. Since its inception, founders Johan
Liedgren (CEO/Principal) and Noah Tannen (Partner/Principal) have
not only been the writers, producers and directors of very popular
and odd-ball content; but on the business side, they have pioneered
new models for revenue from the net syndication, co-production and
sponsorships of their online work.

Johan Liedgren.

Originally from Sweden, Liedgren has spent the last two and a half years
building the Seattle-based studio into an artistically and financially
sound entity, drawing on his passion for both the creative and business
sides of the start-up game, while carefully carving Honkworm's niche
in the new net "space." Along the way, Honkworm has been stylishly
innovative in its toon content as well as instrumental in forging new
architecture of how entertainment, advertisement and commerce can integrate
with web cartoons. For the outsider looking to differentiate companies
such as his own from those like AtomFilms, Wild Brain, iFilm or Entertaindom,
Liedgren suggests one way is "to ask first: is this company trying
to drive traffic to a site -- yes or no?" If the answer is yes,
that company must spend all its time, money and energy into getting
traffic to their web place and will be judged accordingly. Liedgren
emphasizes the fact that, "Honkworm is not a destination site.
We will never spend money to drive any traffic here. We obviously care
if people come and enjoy our work but it's not part of our business
model."

What Honkworm does, he says, is to concentrate all their time, energy
and creativeness into producing really good content. Dan Pepper (COO)
further explains their studio setup by adding, "We do generate
our creative inhouse but we also have contract writers and creatives
that are submitting ideas and concepts that we either will take into
production or develop with them. At that point, we have what I would
call a `virtual studio' kind of model where we can match the concept
to individuals and production entities that best fit the production
design." Liedgren likes to call this particular process "using
e-lancers" and he seems very comfortable in maintaining and expanding
this network of outside storyteller, artist and director relationships.
They both point out that Honkworm retains ownership in all of their
programs. "So our focus," Pepper concludes, "is to
generate Honkworm titles that we essentially build as an asset and
we can then license and syndicate those properties at will."

One example of a Honkworm alliance which significantly bolsters their
production capacity is the four year content development, production
and distribution agreement they signed with Camp Chaos Entertainment
in October of last year. Honkworm secured a first right of refusal
in the acquisition of all Camp Chaos' programs and is additionally
guaranteed non-exclusive distribution rights for all their current
and future content. Based in Philadelphia and continuing to maintain
one of the first web sites to produce regular online Flash cartoons,
Camp Chaos' side of this deal includes a renewable production retainer,
as well as the confidence gained by working hand-in-hand with a reputable
industry leader in online creative programming and distribution. The
relationship had its beginnings with Camp Chaos providing animation
services for Honkworm's Siliconites series. This and other
projects fostered a lot of mutual admiration and finally, the recognition
of the mutual benefits possible by bringing Camp Chaos into a more
defined arrangement with the Honkworm group.

Honkworm International's revenues to date have been from syndication,
co-productions and sponsorships of their creative content. Just recently,
their coffers were supplemented by the infusion of new capital investment
from American Greetings which should give them the ability to go forward
with more partnership, acquisition and/or alliance agreements.

From the sponsorship angle, Honkworm has made history, of sorts, by
mutating the traditional idea of product placement into a successful
online campaign for Budweiser, wrapped around their hugely popular
Fishbar series. Honkworm offered to write and design within
the show's content subliminal, branded Budweiser material -- which
would be in addition to the usual "brought to you by" front
and end tags utilized in typical sponsorship deals. Budweiser was
intrigued but then the question was: what kind of distribution venue
would be acceptable to this idea? The necessary triangle was complete
when Excite came into the picture as the "broadcaster,"
if you will, and the portal ended up actually brokering the final
deal which included featuring the series on its main page. Liedgren
says Budweiser was, of course, "really happy because now not
only did they get to be associated with the Honkworm stuff but they're
up there on Excite which has millions of eyeballs every day looking
at the Budweiser/Honkworm content." This business scenario is
now undoubtedly being used as a model by many other groups struggling
for successful corporate branding and "advertainment." Liedgren
doesn't particularly like that phrase and would rather describe Honkworm's
approach as "entertainment that also works as advertisement."
He is extremely mindful of being "very, very, very sensitive
to the viewers" and understands the dangers of turning them off
if the advertising component is too strong or inappropriate relative
to the creative content. "The viewer and Honkworm obviously have
to be the guys saying, `Stop right here' ... and I know from experience
that you say no to the brand, you never say no to your viewers, right?
You should say no to the brand because if the viewers keep coming,
the brands will be back asking to be part of it again, anyway."

Honkworm is currently being pursued (and pursuing themselves) some
interesting co-production deals in Hollywood and elsewhere from within
the traditional entertainment world. They profess no interest in being
acquired and say they have already turned down numerous large and
lucrative work-for-hire type entreaties. As Liedgren puts it, "To
be an in house creative shop for one studio, I think, is kind of limiting
our `outside.'" Instead, Honkworm is looking at a future with
"Hollywood" that could entail joint projects with, he says,
"established brand-name talent -- like well known comics or famous
broadcast writers" that would join forces with Honkworm, developing
projects where their respective creative sensibilities would overlap
into novel programming. Meanwhile, Liedgren feels Honkworm is right
where it should be, saying, "We're on a roll and growing as fast
as we can." So far, that's been a pretty dynamic and impressive
roll.